New Home for New Century Employees

Employees at Home 123 Mortgage last week were told to stop funding loans by parent New Century, according to its branch vice president Alan Reichstein. Even though it was a prime lending division, the Boca Raton, Fla.-based unit was displaced due to the instability of the subprime market.

Fannie Mae spokesman Alfred King confirmed the secondary lender is no longer accepting loans from New Century.

But the branch office family has found a new home.

The Home 123 branch grew under the direction of Reichstein and Miles Rosenthal, with 90 percent of the volume being prime home loans, Reichstein said.

“We were the Internet division, we were the ‘A’ credit side of the company, so here we were doing $500 million a year, ‘A’ credit loans with no problem the loans were great, we didn’t have any default problems … because some of the issues (New Century) had we were instructed not to fund any loans,” Reichstein told MortgageDaily.com.

With instructions to either return the loans to the borrowers or transfer them to a competing company, Reichstein said he took a look around at all the commission-based loan officers and felt compelled to take action.

“Home 123 and WCS have always been friendly competitors, they have a similar culture and I had heard such good things about their reputation — I talked to Eric,” Reichstein explained.

Eric Wallberg and Carlos Cepeda began Boca Raton-based WCS five years ago and just last year reported $1.2 billion in origination volume.

WCS was very receptive to the addition of 35 new employees, and the quick transition was almost seamless, Wallberg and Reichstein agreed.

“They opened up their arms to us — I’ve never seen anything like it in my entire life,” Reichstein said.

New Century was also helpful in the transfer and they have been very cooperative, he said. “New Century still cares about the customer at the end of the day … they want to do right by the customers and the employees – they’ve been great about it.”

Wallberg said it was a trying time but he had to compliment both his and the Home 123 teams. “They came in and opened their hearts and their files to us and we’ve let them in as a family and now it’s a very good tight niche group — great synergy.”

The merger could put WCS in contention for the largest independent lender, Reichstein said.

“When you take two large entities like this and bring them together, it’s kind of like the Costco effect,” he said. “They all want to come in, give us better pricing, faster turnaround times.”

Wallberg added that the company anticipates funding over $2 billion in 2007.